Seattle Condo Market Update

Daniels Real Estate, the Developer behind the Gridiron project in Pioneer Square, has it's hands in two new condominium projects coming to Seattle.

The first is a project located on First Hill, at 8th Avenue and Columbia Street. This project, known as 800 Columbia, will be a luxury 30 story tower with 287 residents. Rumors are that it will be condominiums. The building will have a rooftop deck, dog run, gym, bike storage, game room, party room, dining room and theater room.

The other is the project located near Pike Place Market at 1631 2nd Ave, now known as The Emerald. On this project, they are not the Developer but instead are the project investors' development consultant along with Create World. This new construction condo building has already broken ground and will be 40 stories and have 265 units. Emerald will have one, two and three bedroom condos ranging in size from 540 to 1,700 square feet. It will have retail on level one and amenities including a gym, yoga studio, pet area, guest suite and rooftop level party room and outdoor space.

We look forward to hearing pricing and anticipated sales and completion dates.

My sellers often ask if the spring and summer are really the best time to list and sell their condo. This is generally true but have you ever wondered why? Let’s go over this, and if you are at all considering selling you condo here in Seattle, this will be helpful info to consider and factor into your decision. The key is to put a plan in place, and that planning should start now during the fall and winter.

As we start to wind down 2017, this is the time of the year I like to speak with my new and past clients that are considering selling so that we can plan for 2018 and nail down the best market timing for the following year!

Final sale price and timing the market run hand in hand, in my opinion, in our Seattle condo market. This is because, unlike a single-family home where often a family is timing their home sale around summer vacations, travel schedules, schools, etc., it’s not usually the biggest motivating factor for a condo seller (nor the condo buyer) since historically we do not see such a big focus on families with children in the urban condo market. It is a growing segment, but still not a governing segment of the condo market. So, the condo market tends to be much more focused on timing as it relates to hiring cycles of companies, rental rates of apartments, and economic factors such as interest rates.

To help highlight the ideal window of time, we found a great report that shows average sale price, by month, on a historical basis. The information is from Trendgraphics and tracks the sales price trends from 2012 through 2016. This report is based on the county averages so I decided to start there, and we’ll zoom in and focus on Seattle condos specifically in an upcoming post.

If you are at all considering selling your condo, pay close attention to timing the market, and let’s talk about the pros and cons of different times of the year.

The attached graphs show a pretty consistent historical pricing trend where the closed selling price of properties starts an upward trend in around March, and that upward trend continues through the summer until around August, where the speed of the price increases appear to level off through the end of the year. Then the pricing starts the following year, where it left off in the previous year with the same upward trend. Therefore, timing is key. Keep in mind these sales would have gone into contract 3-5 weeks prior to the closing date, in most cases. So even though August tends to be the high point of the trend each year, those properties went on the market most likely in the prior month (note: these are stats that contain both condo and single-family sales, but it still illustrates the point of timing the sale and next month we’ll do our own research and focus just on Seattle condo sales and get the historical data to compare). Download Historical Seattle Home Price Graphs by Month

More to come next month. If you are considering selling, now is a good time to start that conversation and I’m here to help and be of service.

This week as I was preparing my final pricing recommendations and offer review strategy for a condo in the pike-pine area of Capitol Hill, I continue to be amazed at the velocity of sales as well as the competitive nature of the Seattle condo market, even for higher-end condominiums in our city.

The condo I will be listing right after the 4th of July holiday for my clients is a nice modern 2 bedroom corner unit and in reviewing recent sales up on the Hill (area 390), it's amazing to me that we are now starting to see pricing falling at an average of $632 dollars per square foot this year for the month of May.

For this specific condo listing, my market value estimation for them last year in 2016 was approximately $580,000-$600,000, when the average pricing was falling at around $540/sqft for the same period last year. Well for this year, this market analysis I am preparing has me realistically thinking they may fetch nearly $675,000 to possibly even $700,000 if we are able to get multiple buyers competing for the condo. That's about a 14% increase for this unit specifically. Not bad.

Sales data from our Windermere Market Update report (linked below), is showing a 15% year-to-date appreciation in sales of condominiums in Capitol Hill (and the rest of area 390) and this is just astounding to me because last year at the same time we were surprised that we were seeing $540 dollars per square foot for the average sale pricing.

With the recent announcement that Amazon is purchasing Whole Foods for $13.7 billion, I personally don't see any immediate slowing in our condo market as it appears our local online retailer isn't planning to slow down growth and likely this means they probably won't be light on the hiring either as they do whatever it is they plan to do with this new acquisition. Strong local economy and job growth often are key factors in our local real estate market's performance.

The included market update report is for the last full month of May 2017 for Capitol Hill and Central area condominiums only (area 390) , but we are seeing similar performance and market velocities in the downtown Seattle core as well. Download Condominium Stats May 2017 Area 390

The condominium market in Seattle remains relatively unchanged from February. The advantage is still to the Seller with high odds of selling and selling above list price.

The graphs below show statistics for Seattle condominiums for MARCH 2017. Questions, let us know!

SUMMARY:- Less inventory than last year at this time, down to .6 months' supply (which is the same inventory level as Feb of this year)- Higher median sales price than last year at this time, up 14%, to $434,000- The highest number of sales so far this year are still happening at the price point between $500,000 and $750,000- 63% of listings are selling above list price (higher % than in February, which was at 54%)- Odds of selling are 105% (less condos coming on the market than are going pending)

After converting their reservation holders into Purchase and Sale Agreements, NEXUS released all unsold homes to the public on Saturday March 18th. Following the conversion of the reservations and that grand opening event, 286 of the 382 homes are sold, a staggering 75%. The remaining 96 homes are in the $800's and up. No studio or open one bedroom plans remain and no lower floor one bedroom homes are left either.

With NEXUS as the only new construction high rise likely to deliver homes before the start of the next decade, there is a lot of pent up demand for new construction condo product in Seattle. Other reasons for the high amount of demand? Commutes increasing within the region are driving people back into the city center. In-migration from Silicon Valley residents due to the relative affordability of real estate, the abundant number of tech jobs available, high incomes and the added bonus that we don't have a state income tax. Also leading to demand, the ability to combine condo units into a larger format home, which is a unique opportunity that can be hard to come across with resale condominiums for obvious reasons.

If you missed out on the grand opening event, but are looking for a higher floor 1 bedroom or a 2 bedroom home at NEXUS, there are still opportunities to buy and we are happy to help you navigate the remaining inventory.

NEXUS condominiums had their ground breaking ceremony this morning. Present were representatives from Burrard Group who is the Developer on the project, Weber Thompson who is the architect, interior designer and landscape architect for the project, Realogic's Sotheby's International Realty who is the marketing and sales team, a representative from the DSA and Skanska who is the contractor.

They announced that they will open for public sales at 11am sharp on Saturday March 18th at their new sales center. They also indicated that they have listed several of the condominium units for sale on the Northwest Multiple Listing Service, though at the time of this post only one was live on the market.

The ideas and inspirations that were mentioned at the ground breaking were the desire to create a new neighborhood within Downtown Seattle and to build the condos where walkability, transportation and proximity to job centers are key. Also noted was the want to incorporate innovative technology into the building, provide flexible floorplans, implement sustainable living ideas, and put forward a design that was not run of the mill. They are now calling the Denny Triangle, the neighborhood where NEXUS will be located, the East Village.

We will attend the VIP Reception this evening and report back on any additional information we learn about NEXUS and the sales process.

The condominium market in Seattle continues to be a seller's market with low inventory and swift sales performance.

The graphs below show statistics for Seattle condominiums for FEBRUARY 2017. Questions, let us know!

SUMMARY:- Less inventory than last year at this time, down to .6 months' supply- Higher median sales price than last year at this time, up 21%, to $474,950- The highest number of sales so far this year are happening at the price point between $500,000 and $750,000- 54% of listings are selling above list price- Odds of selling are 106% (less condos coming on the market than are going pending)

In this recent article by the Seattle times, they do a great job of highlighting the “soaring” 11.4% pricing increases of homes in the Greater Seattle area, but one key thing we have to keep in mind, which often gets overlooked by generalized statistics, is that real estate market trends are very local, and can vary widely from county to county, city to city, and even from neighborhood to neighborhood within the same city. Seattle’s market is very local.

Within the local market, the appreciation also varies based on various factors. As buyers in the Seattle city market are finding, some of the hottest neighborhoods will still see very limited inventory and often bidding wars for homes, but in the same neighborhood this may not translate to other property types such as ultra-luxury properties, and it may not translate to condominiums or townhomes either. If you run the same year over year comparison within specific neighborhoods breaking it out by subcategories such as different price points or different types of property, you will likely find varying appreciation rates across those different sub categories. But I feel this is really key and is more important than what the Greater Seattle area real estate market appreciation looks like. What does your local real estate market and it's different segments look like? That is what is important.

WHEN: Wednesday June 29th 7:30 to 8:30am WHERE: Top Pot in Capitol HillTOPIC: Strategies to Compete for Condos in this Fast Paced Market

This month join me at Top Pot in Capitol Hill where we will discuss strategies to compete for condos in the fast paced Seattle condo market, including tactics on choosing the right lender that will help your offer be more attractive to seller’s and their listing broker.

This will be an ideal Condos Over Coffee event if you are at all considering buying and are wondering what the market is really like for condo buyers out there.

Please RSVP here so that we can make sure to save a seat for you. Friends, family and/or colleagues are welcome to stop by too, so pass the word along!

Oh, and coffee's on me! So stop by on your way to work on Wednesday to chat real estate.

NEXT MONTH'S EVENT - July 27th Next month's Condos over Coffee will be on July 27th where we will have an update on the new construction condo projects coming up in the city, including information on NEXUS, breaking ground soon in Denny Triangle.

LAST MONTH'S EVENT In April we met at the Starbucks in the Denny Regrade and chatted through prepping your condo for the market and understanding the importance of presentation, promotion and price when you are a seller in this market.

Our new video series addressing actual client questions and concerns in our current market. They will cover whatever issues our clients are experiencing and will typically feature a guest who also works in the industry such as a lender, an Escrow closer, a Title rep, etc.

Hopefully you find the videos informative and helpful!

Enjoy Episode 1! "I am moving to Seattle and want to buy right away but don’t start my job for a couple months, what do I do?"

Search

About the Authors

Marco Kronen is the co-author and a condo Realtor. He and Wendy have worked together serving clients in Seattle since 2007. Feel free to contact Marco here.
Wendy Leung is the founding editor of the Seattle Condo Review. She's also a full-service Seattle realtor.